AXS-One Reports Record First Quarter Financial Results
April 29 2004 - 4:15PM
PR Newswire (US)
AXS-One Reports Record First Quarter Financial Results License
Revenue Doubles Over Same Period Last Year; 11th Consecutive
Profitable Quarter RUTHERFORD, N.J., April 29
/PRNewswire-FirstCall/ -- AXS-One Inc. , a leading provider of
enterprise solutions for compliance and governance, today announced
its financial results for the first quarter ended March 31, 2004.
Revenues for the quarter increased approximately 16 percent to
$10.9 million, from $9.4 million in the corresponding prior year
period. License revenues were $2.5 million, including $1 million
(40 percent) related to e-mail management and archiving products,
an increase of 98 percent versus the $1.2 million in license
revenues reported in the same quarter last year. While revenues
increased 16 percent, operating expenses increased only 13 percent.
Operating income increased 55 percent to $806,000, compared to
$520,000 in the first quarter of 2003. Net income for the three
months increased 76 percent to $753,000 compared to $427,000 for
the first quarter last year, as the Company reported its 11th
consecutive profitable quarter. Diluted earnings per share were
$0.03 per diluted share, based on 28.8 million shares outstanding,
compared to diluted earnings per share of $.02 per diluted share,
based on 25.6 million shares outstanding for the first quarter of
2003. The increase in shares is due to an increase in the number of
options that are now exercisable. The Company's balance sheet
reported $3.7 million in cash as of March 31, 2004, compared to
cash of $2.3 million as of March 31, 2003. That amount was
increased in early April 2004 by approximately $7.8 million, which
was a direct result of the recently announced private placement of
shares of common stock. Long-term debt has been fully repaid prior
to March 31, 2004. During the quarter, New York Life Insurance
Company, Raymond James Financial, Inc. and others, chose the
AXS-One(R) Compliance Platform solutions for regulatory compliance,
operational storage and records management for all firm-wide
electronic communications. In addition, the recently announced
marketing partnership with Sector, a subsidiary of the Securities
Industry Automation Corporation (SIAC), was instrumental in closing
key hosted email archival solutions to several financial clients to
achieve regulatory compliance in a fully outsourced environment.
The continued focus on compliance related to electronic
communication, particularly due to the increased government
regulations and accounting guidelines, continues to drive business
for the AXS-One Compliance Platform solutions for electronic
communications, corporate records and overall records management
and disposition. For the quarter, more than 40 percent of the
Company's license revenue was related to enterprise solutions for
compliance, operational & records management, and long-term
archival of electronic communications. Additionally, Pfizer, AIG
and other current global clients invested in additional AXS-One
Enterprise financial management solutions in order to improve the
management and control of their financial processes. For the
quarter, 62 percent of the license revenue recognized was with
customers inside the United States, while 38 percent was recognized
internationally. "I'm pleased to report another successful and
profitable growth quarter for AXS-One, our eleventh consecutive
profitable quarter," commented John Rade, AXS-One Chief Executive
Officer. "We continue to gain traction with our compliance platform
solutions for email, instant messaging and business records
management. I believe these solutions will take on an
ever-increasing level of importance based on the current business
environment for managing risk, along with new legislation,
regulations and compliance guidelines. The Company's earnings were
negatively impacted during the quarter by $200,000 in expenditures,
related to finding my successor and the hiring of two new
operational managers. I believe the Company has a solid foundation
in place and is on a strong footing moving forward." Mr. Rade
continued, "I'm particularly pleased with the important reseller
agreement we initiated with Sun Microsystems in April 2004,
authorizing Sun to sublicense the AXS-One Compliance Platform
solutions for e-mail management and archival management as well as
the AXS-One Enterprise financial management solutions. We hope to
broaden this relationship with Sun, potentially opening new markets
domestically and overseas, and believe this agreement will help us
increase our penetration across key market segments without
substantial increases in sales and marketing expenses. Sun will be
able to deliver more infrastructure value to their customers due to
the tight integration of our software with their product lines."
About AXS-One Inc. AXS-One (AMEX:AXO) is a leading provider of
records management, email and instant messaging archival
management, financial management, and workflow software to
efficiently manage complex business processes. AXS-One has
implemented high-volume, interoperable, scalable, and secure
business solutions for the global 2000. Its Web Services-based
technology has been critically acclaimed as best of class. The
AXS-One Compliance Platform Solutions provide fast deployment of
e-mail/instant messaging archival solutions for regulatory
compliance and operational efficiency. AXS-One has offices in
worldwide, including Australia, Canada, Singapore, United Kingdom,
United States, and South Africa. AXS-One was founded in 1978, and
is headquartered in Rutherford, New Jersey, U.S.A. For further
information, visit the AXS-One web site at http://www.axsone.com/.
AXS-One, the AXS-One logo, "Access Tomorrow Today," AXSPoint and
TransAXS are registered trademarks of, and e-Cellerator, AXS Desk,
"AXS-One Collaboration FrameWorks," SMART, AXS-Link and Tivity are
trademarks of, AXS-One Inc. in the U.S. All other company and
product names are trademarks or registered trademarks of their
respective companies. Special Note Regarding Forward-Looking
Statements: A number of statements contained in this release are
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 that involve risks and
uncertainties that could cause actual results to differ materially
from those expressed or implied in the applicable statements. These
risks and uncertainties include, but are not limited to: potential
vulnerability to technological obsolescence; the risks that its
current and future products may contain errors or defects that
would be difficult and costly to detect and correct; potential
difficulties in managing growth; dependence on key personnel; the
possible impact of competitive products and pricing; and other
risks described in more detail in AXO's Securities and Exchange
Commission filings. AXS-ONE INC. AND SUBSIDIARIES CONSOLIDATED
STATEMENTS OF OPERATIONS (In thousands, except per share data)
(unaudited) Three Months Ended March 31, 2004 2003 Revenues:
License fees $2,460 $1,241 Services 8,411 8,089 Other-related
parties 51 115 Total revenues 10,922 9,445 Operating expenses: Cost
of license fees 411 341 Cost of services 4,269 3,964 Sales and
marketing 1,970 1,631 Research and development 1,899 1,674 General
and administrative 1,567 1,315 Total operating expenses 10,116
8,925 Operating income 806 520 Other income (expense): Interest
income 25 12 Interest expense (12) (73) Gain on sale of subsidiary
-- 71 Equity in losses of joint ventures (33) (19) Other expense,
net (33) (84) Other expense, net (53) (93) Net income $753 $427
Basic and diluted net income per common share $0.03 $0.02 Weighted
average basic common shares outstanding 25,250 24,865 Weighted
average diluted common shares outstanding 28,782 25,581 The
unaudited financial information included in this document is
intended only as summary provided for your convenience, and should
be read in conjunction with the complete consolidated financial
statements of the Company (including the Notes thereto, which set
forth important information) contained in its Reports on Form 10-K
and 10-Q filed by the Company with the U.S. Securities and Exchange
Commission (SEC). Such reports are available on the public EDGAR
electronic filing system maintained by the SEC. This press release
contains forward-looking statements. Such statements are only
predictions, and actual events or results may differ materially.
All forward-looking statements involve risks and uncertainties,
including, without limitation, the risks detailed in the Company's
documents and reports filed from time to time with the Securities
and Exchange Commission. DATASOURCE: AXS-One Inc. CONTACT: William
Levering of AXS-One Inc., +1-201-935-3400, ; or IR, Matthew Hayden
of Hayden Communications, +1-858-456-4533, , for AXS-One Inc. Web
site: http://www.axsone.com/
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